Majority of hospitality businesses operating below 85% of capacity, research shows

The majority of hospitality businesses across the UK are operating at or below 85% of required capacity, according to recent research.

 

A survey of 14,300 hospitality sites conducted by CGA by NIQ in August found that the April tax rises have forced many operators to cut their workforce.

 

Nearly seven in 10 (69%) respondents representing the British Institute of Innkeeping (BII), the British Beer & Pub Association (BBPA), UKHospitality and Hospitality Ulster are operating at or below 85% of required capacity.

 

One in five businesses had no cash reserves, while 73% of those surveyed said they have less than six months’ worth left.

 

More than half of the hospitality venues surveyed had also cut staff members and close to four fifths have increased prices to stay in business.

 

It comes after it was revealed 84,000 jobs have been lost since the Budget, which is expected to cost the sector an additional £3.4b a year, according to UKHospitality.  

 

In a joint statement, the trade bodies said: “This shocking data reinforces the urgent need for government to recognise the incredible pressure hospitality businesses have been put under, particularly since April, and illustrates why it should come forward with measures to support this vital sector at the Budget.

 

“Unsustainable tax increases are squeezing businesses, stifling growth and investment and threatening local employment, especially for young people.”

 

They added: “Hospitality is united in which measures will reverse this trend and drive growth: a reduction in VAT for hospitality, changes to employer National Insurance Contributions and permanently lower business rates for the sector.

 

“Now is the time to act and back a vital British sector that supports the economy, jobs and local communities. We urge the government to do so at the Budget this autumn.”

 

It comes after a Conservative MP warned hospitality is being "taxed out of existence" during a debate in Parliament last month.